Justice News

Identity Thief sentenced for using a new form of fraud “Synthetic Identities”

ATLANTA – Creating “synthetic identities” from phony Social Security numbers is one of the fastest growing forms of identity theft in the United States, and the U.S. Attorney’s Office for the Northern District of Georgia is prosecuting increased numbers of these cases to stay in front of this trend.

One recent case involves Kelvin Lyles, who has been sentenced to three years and ten months in federal prison for wire fraud. Lyles used so-called “synthetic identities,” which are fake identities created by establishing a credit history for false Social Security numbers with the credit reporting agencies. Using this method, Lyles defrauded credit card companies out of over $350,000.

“Synthetic identity theft is an unfortunate new form of criminal fraud,” said U. S. Attorney John Horn. “Identity thieves continue to invent new methods, and this is one more avenue of approach in their attempt to take what is not theirs. We will keep current with these latest trends and do all we can to keep our citizens safe from identity thieves.”

“As synthetic identity theft continues to become one of the fastest-growing consumer fraud schemes, the US Postal Inspection Service will remain steadfast to investigate emerging criminal trends to bring these offenders to justice,” said David M. McGinnis, U.S. Postal Inspector in Charge of the Charlotte Division. “Postal Inspectors will continue to go after those who utilize the U.S. mail for fraudulent financial gain.”

According to U.S. Attorney Horn, the charges and other information presented in court: From January 2013 until December 2015, Lyles obtained and created synthetic identities to obtain credit cards in the names of fictional individuals. Lyles then used online credit card processing services to charge transactions to the credit cards, directing all the stolen funds obtained to himself.

In December 2015, law enforcement executed a search warrant at Lyles’s residence and discovered information for over 300 synthetic identities, fake driver’s licenses, a fake social security card, and numerous credit cards held in the names of individuals other than Lyles. In total, Lyles attempted $435,862.10 in fraudulent credit card transactions and succeeded in obtaining approximately $350,000.

In recent months, the U.S. Attorney’s Office has prosecuted other defendants committing similar kinds of synthetic identity fraud:

On January 5, 2017, Robert F. Dixon, Jr., of Chamblee, Georgia, was sentenced by U.S. District Judge Leigh Martin May to two years, ten months in federal prison to be followed by three years of supervised release for wire fraud conspiracy, wire fraud, and misuse of a Social Security number. Dixon was ordered to pay restitution in the amount of $403,734.55.

On November 17, 2016, Karen A. Bradley, of Lithonia, Georgia, was sentenced by U.S. District Judge Leigh Martin May to one year, six months in federal prison to be followed by three years of supervised release for wire fraud conspiracy and misuse of a Social Security number. Bradley was ordered to pay restitution in the amount of $244,232.31.

On September 1, 2016, Landerick C. Mitchell, of North Charleston, South Carolina, was sentenced by U.S. District Judge Leigh Martin May to six months in federal prison to be followed by three years of supervised release for wire fraud conspiracy and misuse of a Social Security number. Mitchell was ordered to pay restitution in the amount of $23,328.86.

On January 10, 2017, Maurice R. Lambert, of Atlanta, Georgia, pleaded guilty to access device fraud and misuse of a Social Security number. He is scheduled to be sentenced by U.S. District Judge Eleanor L. Ross on May 25, 2017.

While these cases pertain to criminals using synthetic identities, law-abiding citizens also risk being tricked into purchasing a synthetic identity, primarily in the form of a so-called “Consumer Profile Number” or “CPN.” A CPN is a nine-digit number that some credit repair agencies claim can be used as a replacement for a Social Security number in credit and loan applications. Falsely stating in a credit or loan application that a CPN is a Social Security number risks violating federal law. Citizens should be extremely skeptical of any claims from credit repair services that ask them to use a CPN in place of their actual social security number when applying for credit or loans.

Kelvin Lyles, 43, of Atlanta, Georgia, was sentenced by U.S. District Judge Mark H. Cohen to three years, ten months in prison to be followed by three years of supervised release, and ordered to pay restitution in the amount of $353,937.23. Lyles pleaded guilty pursuant to a plea agreement on January 18, 2017.

This case was investigated by the U.S. Postal Inspection Service.

Special Assistant United States Attorney Diane Schulman and Assistant United States Attorney Samir Kaushal prosecuted the case.